BYJU’S lenders have agreed to extend a cooperation agreement between them by a minimum of three months
The agreement signed by the lenders’ consortium, requiring them to act in concert while negotiating with BYJU’S, was set to expire in July
BYJU’S has sued one of its creditors, Redwood, in a US court and challenged the lenders’ demand for acceleration of payment for the loan
Amid the persisting problems with the $1.2 Bn term loan B (TLB) taken by edtech major BYJU’S, its lenders have reportedly agreed to extend a cooperation agreement between them by a minimum of three months.
Earlier, it was reported that an agreement signed by the lenders’ consortium, requiring them to act in concert while negotiating with BYJU’S, was set to expire in July.
Citing people familiar with the development, Economic Times reported that the new agreement is expected to be sent to the broader group of BYJU’S lenders for approval.
BYJU’S has been trying to negotiate with the creditors of its TLB, which it raised in November 2021, to restructure the loan amid financial difficulties. However, the lenders sought a prepayment of $200 Mn, along with a higher interest rate, as a precondition to restructure the TLB.
In a major setback to BYJU’S, its TLB creditors pulled out of the negotiations with the edtech giant earlier this month to restructure the loan.
The creditors called off the discussions and moved to court accusing BYJU’S of hiding $500 Mn of funds raised.
Meanwhile, BYJU’S also sued American investment management firm Redwood and challenged the demand for acceleration of loan payment in a US court.
However, in a major relief for the startup, a court in Delaware rejected the creditors’ plea seeking a probe against the company.
Amid the negotiations with its lenders, BYJU’S three early backers – GV Ravishankar of Peak XV Partners, Prosus’ Russell Dreisenstock, and Vivian Wu of Chan Zuckerberg Initiative – resigned from the broad.
The startup also saw the exit of its statutory auditor Deloitte citing delay in filing financial statements.
BYJU’S has also been trying to raise more funds to support its dwindling financial health. It is reportedly in advanced talks with new investors for a $1 Bn funding round. However, as per the latest development, it is also yet to receive the entire $250 Mn (about INR 2,000 Cr) of debt it raised from the US-based alternative investment firm Davidson Kempner.